AINEWS
Kraken Robotics buys UK's Covelya Group in $615M underwater-tech deal
Kraken paid $615M to fold five subsea brands, including Sonardyne and EIVA, into one underwater drone payload stack as it targets a near quadruple revenue jump.
Kraken paid $615M to fold five subsea brands, including Sonardyne and EIVA, into one underwater drone payload stack as it targets a near quadruple revenue jump.
Kraken Robotics closed its $615 million acquisition of UK subsea-technology parent Covelya Group on July 2 with a stack-integration thesis: own navigation, acoustics, optical imaging, and autonomy software for underwater drones under one roof and capture more revenue per vehicle. The thesis is the one testable claim underneath this deal.
Covelya bundles five subsea brands. Sonardyne makes acoustic navigation and communications hardware used on autonomous underwater vehicles, with applications spanning deep covert missions and multi-vehicle swarms. EIVA contributes the NaviSuite onboard-autonomy software that lets those vehicles process data and navigate without constant operator input. Forcys assembles integrated defence-mission packages that combine those capabilities into deployable systems. Voyis and Chelsea Technologies add optical imaging and sensing payloads. Together the five cover most of the non-vehicle content of an underwater drone, the payload stack that buyers previously assembled piece by piece.
Kraken CEO Greg Reid framed the deal, in interview remarks reported by SaltWire, as a way to scale "dollars per underwater drone," a metric the company had not used publicly before this transaction, but one that maps cleanly onto the integration logic. The combined portfolio, Reid said in the signing announcement, makes Kraken "a much, much larger player in the underwater technology space." The company's updated 2026 guidance, released with the closing, projects annual revenue will approach $600 million within two years. That figure, roughly four times Kraken's pre-deal run rate, is a company projection rather than a reported result, and rests on retaining Covelya's existing customers while cross-selling the bundle.
The deal also redraws Kraken's manufacturing map. Covelya Group's UK headquarters anchors UK production capacity alongside Kraken's existing Canadian and German operations, giving the combined company three-country build-and-integrate reach. Reid told SaltWire the acquisition adds technical headcount as well as geographic optionality, which matters for subsea defence and offshore-energy customers who increasingly want a single vendor responsible for the full underwater system. Subsea refers to equipment and operations beneath the ocean surface, an industrial niche spanning offshore oil and gas, ocean science, naval defence, and undersea-cable installation. The five brands give Kraken immediate access to UK and European defence customers, alongside commercial offshore-wind and undersea-cable operators, without building a UK presence from scratch.
The integration thesis is concrete enough to be tested: payload integration will raise prices while lifting volumes. If Kraken can sell more content per drone (acoustics, software, imaging, mission packages) into the same buyer relationships, the near-quadruple revenue projection becomes plausible. If buyers continue to source payloads individually, the four-fold number slips and the deal becomes a costly market-share move.
The funding mix for the $615 million purchase has not been disclosed in the public closing release, so whether the integration is funded primarily through cash, equity, or debt remains an open variable. The release also names executive appointments intended to run the combined subsea business. How those leaders are resourced against the integration plan will be the next concrete signal.